Oil futures climbed back above the 100 dollar mark as the United States announced a blockade of Iranian ports. The move is designed to ramp up pressure on Tehran and the primary recipients of its crude, most notably China.
The Tokyo Stock Exchange also closed lower, weighed down by the diplomatic impasse between Washington and Tehran.
By 9:30 CET, the FTSE Mib index was trading down 0.5%.
The banking sector is seeing sharp declines, with the sectoral index retreating 1.3%. UNICREDIT, the heaviest weight on the blue-chip index, is down 1.9%, followed by INTESA at -1.3%. Other banking stocks are posting losses of around 1%.
Cyclical stocks, which remain highly sensitive to signs of an economic slowdown, are pulling back. STELLANTIS is down over 2%, while BRUNELLO CUCINELLI has shed 2.8%; the latter, however, is seeing some profit-taking after surging more than 5% on Friday following its quarterly results.
LEONARDO is a bright spot, rebounding 2.5% after Friday's sharp sell-off that hit the broader European defense sector.
With crude prices back above 100 dollars per barrel, the oil sector is gaining ground, with ENI up 0.8% and SAIPEM rising 0.9%.
Finally, POSTE ITALIANE and TIM are attracting bids, both up approximately 1%. Speaking to the FT this morning, Poste CEO Matteo Del Fante emphasized that the current offer is fair and will allow participating investors to benefit from generated synergies and the group's dividend policy.
(Giancarlo Navach, editing Claudia Cristoferi)
